Second Quarter Record Revenue of $83.9 million, increases 24% year-over-year

Points, the global leader in loyalty currency management, today announced results for the second quarter and six months ended June 30, 2016.

"We delivered strong revenue growth of 24% in the second quarter," said Points' CEO, Rob MacLean. "This performance was driven by the expansion of existing loyalty program partnerships, leveraging our ongoing investments in the Loyalty Commerce Platform. We are excited about advancing new Buy, Gift, and Transfer relationships, as well as two further Points Travel wins and additional Points Wallet relationships that we anticipate launching in the second half of the year. Our momentum across multiple businesses makes us confident that our successfully evolving platform strategy now enables us to both grow current relationships while also advancing the successful launch of our two new services, Points Travel and the Loyalty Wallet."

Second Quarter 2016 Financial Results(Unless otherwise stated, all comparisons for the second quarter of 2016 are on a year-over-year basis)

As of June 30, 2016, total funds available, comprised of cash and cash equivalents together with restricted cash and amounts with payment processors, was $61.7 million. Net operating cash, which is defined as total funds available less amounts payable to loyalty program partners, was $10.8 million.

Second Quarter 2016 Business Metrics

Q2/16

Q2/15

Q2/16 vs. Q2/15

Q1/16

Q2/16 vs. Q1/16

Total All Channels

Points/Miles Transacted (in 000s)

6,633,624

5,366,496

24

%

5,664,856

17

%

No. of Points/Miles Transactions

630,489

591,647

7

%

638,569

-1

%

Recent Business Highlights

Saw significant momentum with Points Travel, the first private label travel e-commerce service designed specifically for the loyalty industry, recently signing with two additional partners:

Hawaiian Airlines, a leading regional US airline, will offer their members the ability to redeem their frequent flyer miles by making hotel bookings around the globe using a white-label Points Travel service.

Imminent launch of a leading North American retail coalition loyalty program with more than 10 million active members, that will see members earning points when making worldwide hotel bookings via a program branded web site.

Along with strong core business growth, announced new and forthcoming launches with Points Loyalty Wallet, which allows users to track, manage and interact between multiple loyalty rewards programs via multiple distribution channels:

App in the Air, a travel app with a member base of over 1.7 million frequent travelers, introduced a new loyalty section into its app, powered by the Points Loyalty Wallet, where users can store loyalty information from more than 100 global loyalty rewards programs and exchange loyalty currencies between participating programs

Choice Hotels, a leading global hotel chain that franchises more than 6,300 hotels, will deploy the Points Loyalty Wallet into their web channels later this year, allowing Choice Privileges program members to more easily, quickly and securely exchange their hotel points for a dozen different frequent flyer miles in participating partner programs

Saw continued momentum in the retail space as Points expanded partnerships between the RBC Rewards program and leading retailers with the recent launch of a Home Depot Canada partnership and the pending launch of a similar pilot program with Apple Canada.

Share BuybackIn the second quarter, the Company repurchased approximately 43,682 shares of its common stock for a total of $0.4 million at an average price of $9.27 per share.

OutlookThe Company is maintaining financial guidance for the year ending December 31, 2016, as follows:

Revenue is expected to grow 10% to 20% over 2015

Adjusted EBITDA is expected to grow 10% or more over 2015

As previously announced, beginning in 2016, the Company updated its calculation of Adjusted EBITDA to adjust for the impact of share-based compensation, to be more in-line with peer and industry standards. Figures for prior periods have been adjusted to reflect this in comparisons.

Investor Conference CallPoints' conference call with investors will be held today at 4:30 p.m. Eastern Time. To participate, investors from the US and Canada should dial (877) 407-0784 ten minutes prior to the start time. International callers should dial (201) 689-8560.

In addition, the call is being webcast and can be accessed at the Company's web site: www.points.com and will be archived online upon completion of the call. A telephonic replay of the conference call will also be available until 11:59 p.m. Eastern Time on Wednesday, August 24, 2016, by dialing (877) 870-5176 in the U.S. and Canada and (858) 384-5517 internationally and entering the passcode 13642147.

About Points Points, publicly traded as Points International Ltd. (TSX:PTS)(Nasdaq:PCOM), provides loyalty eCommerce and technology solutions to the world's top brands to power innovative services that drive increased loyalty program revenue and member engagement. With a growing network of over 50 global loyalty programs integrated into its unique Loyalty Commerce Platform, Points offers three core private or co-branded services: its Buy Gift and Transfer service retails loyalty points and miles directly to consumers; its Points Loyalty Wallet service offers any developer transactional access to dozens of loyalty programs and their hundreds of millions of members via a package of APIs; and its Points Travel service helps loyalty programs increase program revenue from hotel bookings, and provides more opportunities for members to earn and redeem loyalty rewards more quickly. Points is headquartered in Toronto with offices in San Francisco and London.

Caution Regarding Forward-Looking Statements This press release contains or incorporates forward-looking statements within the meaning of United States securities legislation, and forward-looking information within the meaning of Canadian securities legislation (collectively, "forward-looking statements"). These forward-looking statements include, among other things, opportunities for new products and partners and incremental revenue, potential for growth in revenue and gross margin and our guidance for 2016 with respect to revenue growth and Adjusted EBITDA expectations. These statements are not historical facts but instead represent only Points' expectations, estimates and projections regarding future events.

Although Points believes the expectations reflected in such forward-looking statements are reasonable, such statements are not guarantees of future performance and are subject to important risks and uncertainties that are difficult to predict. Certain material assumptions or estimates are applied in making forward-looking statements, and actual results may differ materially from those expressed or implied in such statements. Undue reliance should not be placed on such statements. In particular, the financial outlooks herein assume Points will be able to maintain its existing contractual relationships and products, that such products continue to perform in a manner consistent with Points' past experience, that Points will be able to generate new business from our pipeline at expected margins, our in-market and newly launched products and services will perform in a manner consistent with the Company's past experience and we will be able to contain costs. Our ability to convert our pipeline of prospective partners and product launches is subject to significant risk and there can be no assurance that we will launch new partners or new products with existing partners as expected or planned nor can there be any assurance that Points will be successful in maintaining its existing contractual relationships or maintaining existing products with existing partners. Other important risk factors that could cause actual results to differ materially include the risk factors discussed in Points' annual information form, Form-40-F, annual and interim management's discussion and analysis, and annual and interim financial statements and the notes thereto. These documents are available at www.sedar.com and www.sec.gov.

The forward-looking statements contained in this press release are made as at the date of this release and, accordingly, are subject to change after such date. Except as required by law, Points does not undertake any obligation to update or revise any forward-looking statements made or incorporated in this press release, whether as a result of new information, future events or otherwise.

Use of non-GAAP measuresThe Corporation's financial statements are prepared in accordance with International Financial Reporting Standards ("IFRS"). Management uses certain non-GAAP measures, which are defined in the appropriate sections of this press release, to better assess the Corporation's underlying performance. These measures are reviewed regularly by management and the Corporation's Board of Director's in assessing the Corporation's performance and in making decisions about ongoing operations. These measures are also used by investors as an indicator of the Corporation's operating performance. Readers are cautioned that these terms are not recognized GAAP measures and do not have a standardized GAAP meaning under IFRS and should not be construed as alternatives to IFRS terms, such as net income.

Points International Ltd.

Key Financial Measures and Schedule of Non-GAAP Reconciliations

Gross Profit Information1

Expressed in thousands of United States dollars

For the three months ended

For the six months ended

June 30, 2016

June 30, 2015

June 30, 2016

June 30, 2015

Total Revenue Direct cost of principal revenue

$

83,86472,704

$

67,89856,577

$

157,424136,069

$

135,015112,393

Gross Profit

$

11,160

$

11,321

$

21,355

$

22,622

Gross Margin

13

%

17

%

14

%

17

%

Reconciliation of Net Income to Adjusted EBITDA2

Expressed in thousands of United States dollars

For the three months ended

For the six months ended

June 30, 2016

June 30, 2015

June 30, 2016

June 30, 2015

Net Income

$

931

$

1,721

$

1,824

$

3,436

Adjustments:

Income tax expense

220

820

616

1,671

Depreciation and Amortization

1,297

883

2,227

1,760

Total adjustments

1,517

1,703

2,843

3,431

EBITDA

2,448

3,424

4,667

6,867

Foreign Exchange loss (gain)

88

(141

)

168

(5

)

Share-based compensation

690

570

1,358

1,071

Adjusted EBITDA

$

3,226

$

3,853

$

6,193

$

7,933

1 Gross Profit is defined as total revenues less the direct cost of principal revenues. Gross Profit is considered by Management to be an integral measure of financial performance and represents the amount of revenues retained by the Corporation after incurring direct costs. However, Gross Profit is not a recognized measure of profitability under IFRS.

2 Adjusted EBITDA (Earnings before interest, taxes, depreciation and amortization, stock-based compensation and foreign exchange) is considered by Management to be a useful supplemental measure when assessing financial performance. Management believes that Adjusted EBITDA is an important indicator of the Corporation's ability to generate liquidity through operating cash flow to fund future capital expenditures and working capital needs. However, Adjusted EBITDA is not a measure of financial performance under IFRS and should not be considered a substitute for Net Income, which we believe to be the most directly comparable IFRS measure.

Points International Ltd.

Condensed Consolidated Interim Statements of Financial Positions

Expressed in thousands of United States dollars

(Unaudited)

As at

June 30,2016

December 31,2015

ASSETS

Current assets

Cash and cash equivalents

$

55,371

$

51,364

Restricted cash

500

1,000

Funds receivable from payment processors

5,791

6,588

Accounts receivable

3,596

2,988

Prepaid expenses and other assets

2,553

1,256

Total current assets

$

67,811

$

63,196

Non-currentassets

Property and equipment

1,229

1,466

Intangible assets

18,056

18,616

Goodwill

7,130

7,130

Deferred tax assets

1,433

1,755

Long-term investment

5,000

5,000

Other assets

2,721

2,765

Total non-current assets

$

35,569

$

36,732

Total assets

$

103,380

$

99,928

LIABILITIES

Current liabilities

Accounts payable and accrued liabilities

$

5,356

$

5,808

Payable to loyalty program partners

50,841

49,526

Current portion of other liabilities

833

1,852

Total current liabilities

$

57,030

$

57,186

Non-current liabilities

Deferred tax liabilities

445

425

Other liabilities

228

122

Total non-current liabilities

$

693

$

547

Total liabilities

$

57,723

$

57,733

SHAREHOLDERS' EQUITY

Share capital

59,313

59,293

Contributed surplus

10,527

9,859

Accumulated other comprehensive income (loss)

326

(624

)

Accumulated deficit

(24,509

)

(26,333

)

Total shareholders' equity

$

45,657

42,195

Total liabilities and shareholders' equity

$

103,380

99,928

Points International Ltd.

Condensed Consolidated Interim Statements of Comprehensive Income

Expressed in thousands of United States dollars, except per share amounts

(Unaudited)

For the three months ended

For the six months ended

June 30,2016

June 30,2015

June 30,2016

June 30,2015

REVENUE

Principal

$

80,529

$

64,930

$

151,270

$

127,555

Other partner revenue

3,288

2,951

6,061

7,427

Interest

47

17

93

33

Total Revenue

$

83,864

$

67,898

$

157,424

$

135,015

EXPENSES

Direct cost of principal revenue

72,704

56,577

136,069

112,393

Employment costs

6,214

5,823

12,117

11,747

Marketing and communications

461

399

787

674

Technology services

416

361

790

631

Depreciation and amortization

1,297

883

2,227

1,760

Foreign exchange (gain) loss

88

(141

)

168

(5

)

Operating expenses

1,533

1,455

2,826

2,708

Total Expenses

$

82,713

$

65,357

$

154,984

$

129,908

OPERATING INCOME BEFORE INCOME TAXES

$

1,151

$

2,541

$

2,440

$

5,107

Income tax expense

220

820

616

1,671

NET INCOME

$

931

$

1,721

$

1,824

$

3,436

OTHER COMPREHENSIVE INCOME

Items that will subsequently be reclassified to profit or loss:Unrealized gain (loss) on foreign exchange derivative designated as cash flow hedges

135

156

955

(606

)

Income tax effect

(36

)

(41

)

(253

)

161

Reclassification to net income of loss on foreign exchange derivatives designated as cash flow hedges

29

321

337

653

Income tax effect

(7

)

(85

)

(89

)

(173

)

Other comprehensive income for the period, net of income tax

$

121

$

351

$

950

$

35

TOTAL COMPREHENSIVE INCOME

$

1,052

$

2,072

$

2,774

$

3,471

EARNINGS PER SHARE

Basic earnings per share

$

0.06

$

0.11

$

0.12

$

0.22

Diluted earnings per share

$

0.06

$

0.11

$

0.12

$

0.22

Points International Ltd.

Condensed Consolidated Interim Statements of Changes in Equity

Attributable to equity holders of the Company

Expressed in thousands of United States dollars except number of shares(Unaudited)

Amounts received for interest were reflected as operating cash flows in the condensed consolidated interim statements of cash flows.

About Points

Points, publicly traded as Points International Ltd. (TSX:PTS)(Nasdaq:PCOM), provides loyalty eCommerce and technology solutions to the world's top brands to power innovative services that drive increased loyalty program revenue and member engagement. With a growing network of over 50 global loyalty programs integrated into its unique Loyalty Commerce Platform, Points offers three core private or co-branded services: its Buy Gift and Transfer service retails loyalty points and miles directly to consumers; its Points Loyalty Wallet service offers any developer transactional access to dozens of loyalty programs and their hundreds of millions of members via a package of APIs; and its Points Travel service helps loyalty programs increase program revenue from hotel bookings, and provides more opportunities for members to earn and redeem loyalty rewards more quickly. Points is headquartered in Toronto with offices in San Francisco and London.